In a bid to encourage digital transactions, the Reserve Bank of India (RBI) on Friday proposed to increase the per transaction limit from Rs 2 lakh to Rs 5 lakh through Immediate Payment Service (IMPS).

IMPS managed by the National Payments Corporation of India (NPCI) is an significant payment system providing round-the-clock instant domestic funds transfer facility and is accessible through various channels like internet banking, mobile banking apps, bank branches, ATMs, SMS and IVRS. With RTGS now operational round the clock, there has been a corresponding increase in settlement cycles of IMPS, thereby reducing the credit and settlement risks.

"In view of the importance of the IMPS system and for enhanced consumer convenience, it is proposed to increase the per transaction limit from Rs 2 lakh to Rs 5 lakh," RBI Governor Shaktikanta Das said. This will lead to further increase in digital payments and will provide an additional facility to customers for making digital payments beyond Rs 2 lakh, he said, adding, necessary instructions in this regard would be issued separately. RBI has extended dates for the classification of bank credit to focused NBFCs as priority sector lending till March 31, 2022.

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